Many would argue that these days you need a mobile phone of some sort just to function in the modern world. The truth is, though, that not everyone can get a contract with a shiny new handset thrown in. Handset contracts are credit agreements, and that means credit checks.
Most of us have likely experienced a period of financial hardship at some point in our lives. So it's just as well there are still a few different ways to own and operate a mobile phone no matter how poor our credit history. Not only pay as you go – most of us are familiar with that concept, but we'll cover it further in – but also a handful of providers who won't do credit checks at all, provided you only need a SIM and that you have an unlocked mobile handset available to use. Let's take a look.
Broadly speaking, there are four types of mobile deal available to the general public. If you have a poor credit history you'll have access to only two of them.
You might think the answer to this question is pretty obvious. And it is, in part. But there is more than one type of person who may benefit from looking into a deal without a credit check.
There are only a handful of providers right now that actively advertise deals with no credit checks. As for the rest? Well, it's a bit of a lottery. Discovering whether or not other providers conduct credit checks on their SIM contracts and handset contracts is easy: They all do. However, trying to unearth information about whether they do on their 30-day contract SIMs is like pulling teeth.
As a rule of thumb, it's safe to assume most of them do, though the criteria to 'pass' these checks will be considerably more lax than those levied on a handset deal. Here are the providers that don't do credit checks. Please bear in mind that giffgaff will still do credit checks on any of its contract deals, either SIM or handset.
In all cases, no. Sadly, the very nature of mobile phone deals that come with a handset prevent this. When you enter into a handset mobile contract you are opening a hire-purchase credit account, paying off the cost of the handset in instalments.
Right now there appears to be no ceiling to the cost of a handset, with Apple's insanely-priced iPhone 13 Pro already being shattered by folding phones from Samsung and Huawei. And that means this model is unlikely to go away anytime soon. Ultimately, it means if you want a tasty new handset, you'll have to either buy it yourself outright in a lump sum, or succumb to credit checks and hope for the best.
Yes. In the case of both pay as you go (PAYG) and no credit check rolling 30-day contracts you will be paying upfront. However, just because you choose a 30-day contract doesn't mean you won't be credit checked. See the section on providers of no credit check SIM deals above to be sure you won't be.
Not all rolling 30-day plans do, no. Only those from providers who advertise no credit checks. See above for the – short – list. Other options of course include PAYG SIMs, some of which, such as those from ASDA Mobile, offer monthly 'SIM-only bundles' of minutes, texts and data you can pay for up-front.
If you want something other than a PAYG SIM deal then yes. Sadly, due to the hire-purchase nature of contract phones, and the additional value offered by providers to those willing to stick around for 12 months or more, providers need to be sure you're in a position to pay across the length of the contract. Credit checks, then, are a given.
When you take out a contract SIM, you are committing to remaining with your chosen provider for at least 12 months. Why would you do that if you could just commit for 30 days at a time? Well, because there are benefits. Contract SIMs tend to work out cheaper and offer more minutes, texts and data than their non-contract counterparts.
When you miss payments on existing credit arrangements, fail to pay your bills or default on direct debits via your bank, these organisations will report this behaviour to credit reference agencies. Equally, payments made on time are assumed by these agencies in the absence of evidence to the contrary. 'Bad behaviour' for want of a better term, stays on your record for six years. If you failed a credit check, the chances are high your credit rating is simply not good enough.
It’s recommended that you conduct a credit check once a year – you have a legal right to all the information lending companies hold on you. Both Experian and Equifax will let you check your credit record for free. Since these are the companies most creditors use to determine your credit-worthiness, you should start there. Some companies such as Credit Karma and Clearscore offer ‘free-for-life’ monthly reports; however, they will then bombard you with credit offers that ‘match’ your profile, so if you don’t want that, it may be best to just pay the small fee.